Bubble Bursting: The Market Is On The Cusp Of A Big Crash

The most famous law of economics that everyone learns in Econ 101 is the law of supply and demand. Essentially, if there are more buyers than sellers then prices will go up until equilibrium is reached. Conversely, if there are more sellers than buyers prices will decline. The stock market is no different.

If there are more buyers of stocks than sellers, the stock market will rise and will continue to do so until either the ranks of willing buyers thins out and/or the ranks of sellers grows. When equilibrium is reached between buyers and sellers a market begins to stall. When you have a continued stream of sellers dumping their holdings, a bear market ensues.